Infinite banking is a way for people to establish control over their finances. It is a concept that not a lot of people are intimately familiar with, which is why it is important to go over what it does and why it is a force for positive change.
Infinite banking allows people to control their finances in a more exacting manner than they would have been able to do with a traditional bank. This process is accomplished through the interactions with a universal life insurance policy, as well as its presence on the stock market.
When you take out a life insurance policy, you are able to do a lot more with it than many people realize. In fact, you can utilize it as a personal banking, making it a place to store funds, withdraw them, invest, and have expenses covered.
When a person configures a universal life insurance policy to be their own personal bank, they will put their paychecks into the life insurance fund rather than with a bank. This money is able to grow over time with interest due to the fact that these funds are a part of the stock market.
The primary difference is that while investments which are made personally or through a traditional bank are subject to risk while on the market, life insurance policies are actually fairly safe. In fact, there are protections in place to prevent major losses for these funds while they are on the market.
It does make perfect sense- it is important to protect the life insurance of people, because you never know when they might need it. Therefore, these funds are protected on the market and actually have a viable potential for growth without excess risk.
If there is none defining feature of the stock market in general, it is that higher risk investments are going to be more lucrative at the expense of not being safe. Meanwhile, conservative investment are going to be safe, but have very low growth.
Life insurance funds on the market manage to be safe while permitting better wroth at a determined rate. Therefore, the money that you put into these funds with every paycheck will be able to grow at a rate that exceeds traditional insurance rates.
You also have control over your finances in that you can sell portions of the investment on the market in order to “withdraw” cash. Depositing money into them will raise the overall interest earned as a percentage.
Life insurance policies are also useful because they can cover some of the expenses that are necessary to maintain your health and quality of life. Use these coverages to save money.
All in all, infinite banking is a viable strategy that uses the best of various financial scenarios to give you control over your own finances. Therefore, it is a beneficial strategy that is well worth looking into, due to the sheer amount of benefits that it is able to provide to those who utilize the system effectively.